This is a Phase I study. We are actively enrolling subjects in this important study of estradiol treatment of mild to moderate depression in aging women. Results of this study will contribute to the rapidly growing knowledge base regarding endogenous sex steroids and their relationship to depressive and cognitive symptomatology. The purpose of this protocol is to determine in postmenopausal women who are not currently on estrogen replacement therapy (ERT), whether symptoms of mild to postmenopausal women whose mild to moderate depression does not respond to estrogen alone. The protocol will obtain pilot data on the question of whether estrogen treatment facilitates response to sertraline, a serotonergic anti-depressant.